COAL INDUSTRY ACROSS EUROPE 5TH EDITION 2013

COAL
INDUSTRY
ACROSS EUROPE
5th
edition 2013

1 Foreword by Philip Lowe,
Director-General for Energy, European Commission
2 Introduction by Paweł Smoleń,
President of EURACOAL
5 Global energy trends and the international coal market
20 The socio-economic value of a sustainable European coal industry
Country profiles
24 Bulgaria
26 Czech Republic
29 Germany
34 Greece
36 Hungary
38 Poland
42 Romania
44 Serbia
46 Slovakia
48 Slovenia
50 Spain
52 Turkey
55 Ukraine
58 United Kingdom
60 Other EU Member States and Energy Community stakeholders
72 EU statistics
74 EURACOAL
75 Glossary
75 Data sources and references
76 Coal classification
Contents
Coal industry across Europe 2013

1Coal industry across Europe 2013
Foreword
The challenges facing the energy world – and the coal
industry in particular – are getting more complex. Global
energy markets have become increasingly competitive and
Europe finds itself in a race for resources and investments.
Energy policies and political commitments have had to
adapt in the wake of the economic crisis. US shale gas has
brought cheaper coal from the US to Europe, shifting the
balance in Europe between gas and coal. At the same time,
global energy-related CO2
emissions in 2012 reached a new
historic high, whilst scientific consensus on the direct link
between our use of energy and climate change, described
in the latest IPCC report, has never been stronger.
To deal with these challenges, EU policy makers, together
with Member States, are working to find the right balance
between sustainability, competitiveness and security
of supply concerns, not just in our current strategy and
programmes, but also for the forthcoming EU 2030 energy
and climate policy framework.
These challenges also have an impact on the European
coal industry. The economic arguments for coal have
changed recently in its favour. Coal provides much-needed
security of supply in our electricity network. After years
of decline, demand for coal in the EU has started rising
again, with coal imports up 7 % in 2012. On the other
hand, many coal plants will be faced with closure due to
new air pollution limits coming into force in 2016. EU coal
production will be affected by the phase out of state aid
by 2018. In addition, policies to reduce greenhouse gas
emissions have a particularly profound impact on the coal
industry and coal-fired power generation.
Foreword by Philip Lowe, Director-General for Energy, European Commission
Philip Lowe, Director-General for Energy, European Commission
Coal plays an important role in the European economy.
Over one quarter of our electricity comes from coal. Coal
and related industries employ well over 200 000 people.
Balancing the benefits of coal with its environmental
impact is a challenge both for the coal industry and for
European policy makers.
The facts are undeniable: 87 % of the EU’s CO2
emissions
come from energy production or use, with energy
industries remaining the dominant source. The only way
to reconcile the use of coal with a low-carbon and efficient
energy system is with greater flexibility, more efficiency
and the widespread uptake of carbon dioxide capture
and storage – CCS. It is essential for the coal and power
industries to develop more low-carbon options for coal-
fired electricity generation. Investing today will give us a
more diversified energy mix in the future.
Making progress on CCS development is not just a
technical and financial challenge, but also a political issue.
The Commission’s March 2013 communication on CCS
re-launched the debate on how to give CCS the kick-start
that it needs. Ideally, the Commission would like to see
a commercial-scale demonstration project running this
side of 2020. However, we are also aware of the many
obstacles which need to be overcome. We want to work
with the coal industry, coal generators and coal investors
to find innovative solutions for the future of coal and to
ensure that coal continues to be a useful resource in a
low-carbon energy system.

2 Coal industry across Europe 2013
Paweł Smoleń, President of EURACOAL
Introduction by Paweł Smoleń, President of EURACOAL
Introduction
This is the fifth edition of “Coal industry across Europe”
and comes at a time when coal is making a resurgence
in Europe. Since the first edition was published in
2003, the coal industry in Europe has undergone a
transformation. Underground coal mining has become
more automated and more productive in order to
compete against imported coal. Surface lignite mining
has become a much more important component of
energy supply as enlargement of the European Union
has brought in countries with rich deposits of this
valuable resource. Unfortunately, Europe is in the fifth
year of an economic crisis and austerity measures.
The means to wealth creation are under scrutiny.
Whatever the conclusions, we can be sure that basic
industries, like coal mining, will play a decisive role in
pulling Europe out of this crisis and back to prosperity.
The European Union is the world’s third largest coal - using
region, after China and North America. Each year, we
mine around 130 million tonnes of hard coal and import a
further 210 million tonnes making us the world’s largest
importer behind China. At 430 million tonnes, our lignite
production far exceeds that from any other region. Russia,
Australia, the USA and Turkey each mine around 70 million
tonnes, far behind Germany which produced 185 million
tonnes in 2012. Most Europeans never see a lump of coal,
but they use it in their homes in the form of electricity:
27 % of EU electricity production comes from burning coal
and lignite in power stations.
Despite these remarkable statistics, coal and lignite
are not always viewed positively. They are abundant,
affordable and accessible so add to the security and
competitiveness of energy supply in the EU. 88 % of EU
fossil energy reserves are in the form of coal and lignite.
However, burning fossil fuels of any type – coal, oil or
gas – releases carbon dioxide (CO2
) into the atmosphere
that is thought to cause global warming and climate
change. It is right that the coal industry is taking steps to
reduce emissions. EURACOAL itself calls for a three - step
strategy encompassing power plant modernisation to
improve efficiency using technologies that are commercial
today, research and development into even more efficient
technologies for tomorrow and finally deploying CO2
capture and storage the day after tomorrow.
In too many countries, there is a reluctance to take even
the first of these practical steps as policy shifts against
coal. This needs to be reversed so that the EU is not left
behind in a world that is embracing coal like never before.
We need to demonstrate how to use coal cleanly and
efficiently. There are good examples that we can be proud
of and use to promote European technology. In Denmark,
one can find the world’s most efficient coal - fired power
plants. In Germany, lignite - fired power plants that have
opened in the last couple of years are the world’s most
flexible – perfect for balancing the increasing share of
electricity from renewable energy sources under the
German Energiewende. In the Netherlands, new coal - fired
power plants will open shortly and ensure that the country

Introduction by Paweł Smoleń, President of EURACOAL
does not become dependent on imported gas as its
own North Sea gas reserves deplete. These are all good
examples, but when we look to Eastern and South East
Europe a different picture emerges.
Newer member states have not been so lucky because
the investment climate has not favoured renewal of their
ageing and often inefficient coal - fired assets. The basics
must be in place to support economic growth. For most
countries, this means a reliable and affordable electricity
supply that does not pollute the countryside. Whilst many
in Western Europe can be satisfied with the progress
that has been made in that direction, the same is not true
across all parts of the Union.
A startling fact emerges from the chapter that reviews
global energy trends. In 2012, China’s coal production
grew by 130 million tonnes – the same as total EU hard
coal production. In truth, the EU is now responsible for
a rather small and declining share of global greenhouse
gas emissions – just 11 % – although EU consumers enjoy
the benefits of products from China. This trend towards
globalisation extends the EU’s carbon footprint in ways
that are not properly appreciated.
EU climate and energy policy aims to shift energy
consumers in Europe away from coal towards gas.
This is one reason why gas is so expensive in Europe –
a market is being created not through competitive
forces, but through policy, legislation and regulation.
If this continues, we will wake up one day to find that
competitive energy markets have all but disappeared.
Today, it is only competition between coal and gas that
protects consumers from high electricity prices.
This report summarises coal industry developments not
only across the EU - 28 but also the Energy Community
which includes countries where there are enormous
investment opportunities in the energy sector. Countries
that were ravaged by war not so many years ago are
vigorously rebuilding their economies. Many of these
countries sit on coal and lignite reserves that they want
to exploit to provide electricity for their fast - growing
economies. If European banks do not lend money to these
countries, then it will be Chinese banks with Chinese
technology. European power plant suppliers would miss
out on new projects right on their doorstep. The EU
needs a strong industrial policy to match its strong climate
policy so that member states and neighbouring countries
become wealthier.
I am pleased that EURACOAL’s thirty four members have
worked together to produce a report that offers so much
information within its pages. Like the European project,
it brings the quarter of a million men and women who
work in the coal industry closer together, makes us all
more aware of the challenges that we face and hints at
ways forward to a more prosperous future. With greater
prosperity, Europe can look forward to a cleaner and
brighter future. For many countries, the foundation of
prosperity comes from the exploitation of their natural
resources, beginning with coal and lignite.

GERMANY
RECULTIVATION
OF COLLIERY SPOIL TIPS
Over the long history of coal mining in the Ruhr basin,
hard coal extraction from underground mines inevitably
produced unwanted waste material – now a feature of
the surface landscape in coalfield areas. Some of these
spoil heaps have undergone changes on their own, others
have provided a site for artistic works. “Totem“ is a piece
of contemporary art by the Basque painter and sculptor
Agustín Ibarrola. Created from more than one hundred
railway sleepers, it is intended to portray the apparent
contradictions between industrial landscapes and nature.
UNITED KINGDOM
NORTHUMBERLANDIA –
THE LADY OF COAL
At Shotton in Northumberland, the Banks Group decided to create
the world’s largest human landform “Northumberlandia”, using
1.5 million tonnes of carefully selected stone, clay and soil
extracted from the adjacent Shotton surface mine. The Lady was
designed in line with a “restoration first” approach, where extra
land not needed for coal mining was provided by the landowner
Blagdon Estate to deliver a lasting and positive legacy for both the
local community and the wider region.
Since being officially opened by Her Royal Highness The Princess
Royal in September 2012, “Northumberlandia” has proved
extremely popular with local residents and tourists alike. Many
thousands of people visit the 47-acre public park in which she
resides every week.
GERMANY
WATER BUFFALOES
AT LAKOMA
Since the natural paradise of ”Spreeaue“ was opened to
visitors in 2007, thousands of tourists, cyclists, hikers, kids
and teenagers have come to visit this fascinating area of
530 hectares between Cottbus and Spreewald in Germany.
The area became the new home to more than 146 000
amphibians, while oxen, wild horses and water
buffaloes graze on the meadows. Many fish are bred
in the ponds. Fire - bellied toads and tree frogs have
found a new habitat in the biotopes which draw
locals and tourists from all across Germany. The new
landscape offers new perspectives and new views
on local sustainable development.

Global energy trends and
the international coal market
There are many sources of energy data and reconciling
these is a task for professionals. Government bodies,
such as the European Commission, Eurostat, International
Energy Agency (IEA) and the US Energy Information
Administration, alongside private companies, investment
banks and market research consultancies, aim to provide
consistent data to policy makers and other users.
Many also forecast future energy supply and demand.
EURACOAL itself collects historic data from its members
and national governments to build a picture of coal
industry developments in Europe for publication in its
regular coal market reports. In this chapter, data is drawn
from various sources to present a concise overview of
global energy trends, notably coal market data from VDKi –
the German coal importers association. Coal is seen to be
well on the way to becoming the world’s most important
energy source, helped by a well - functioning international
coal market. In contrast, Europe’s importance is shown
to be declining as energy demand in the emerging
economies overtakes that of Western consumers.
Global energy reserves and resources
We are not about to run out of energy: the world has
sufficient energy reserves of all types for the next
80 years and resources to last over one thousand years.
Well over one half of our reserves are in the form of coal
and lignite which together account for an even larger share
of resources (Figure 1). Natural gas, oil and nuclear fuels
make up the remainder of total non - renewable energy
reserves and resources. Renewable energy is abundant
and – in the case of wind, solar and geothermal – practically
inexhaustible, although much harder to quantify as a
resource since converting it into useful energy can be
inefficient and expensive.
Figure 1
Global production, reserves and resources of non - renewable fuels
Source: BGR, 2013
billion tonnes of coal equivalent (Gtce – data for the end of 2011)
2.2 %
1.2 %
79.8 %
3.4 %
9.3 %
2.4 %
Coal and lignite reserves are sufficient for the next
137 years at current rates of production. Unlike oil and gas,
coal is widely distributed around the world with particularly
large reserves in the USA, Russia and China (Figure 2).
For this reason, coal offers a much higher level of supply
security: most coal produced is used in the country of
extraction. Where there is an indigenous source of coal,
supply security is self - evident. Where coal is imported,
supply is supported by a competitive market and a
well - developed infrastructure.
At around 3 %, the European Union’s share of global energy
reserves and resources is rather small (Table 1). As at the
global level, it is the reserves and resources of coal and
lignite that are most significant: together they account for
94 % of the EU’s remaining potential. Some coal deposits
lie near consumers and can be exploited under very
favourable conditions. For example, surface - mined lignite
in Bulgaria, the Czech Republic, Germany, Greece, Hungary,
Poland and Romania is used mainly for power generation,
often transported to power plants over short distances by
conveyor belt to produce some of the lowest - cost electricity
in Europe. Hard coal, both indigenously produced and
imported, is much less expensive than imported oil or gas
and the majority of EU member states enjoy the benefits
of competitive coal - fired electricity generation.
Hard coal
Lignite
Uranium
Thorium
Oil
Unconv. oil
Natural gas
Unconv. gas
resources:
18 156 billion tonnes
reserves:
1 346 billion tonnes
0.5 %
1.2 %
47.4 %
8.3 %
2.7 %
17.8 %
5.1 %
18.3 %0.4 %
total energy production:
16.9 billion tonnes

17
148
3
104
Africa
Australia & NZ
Other AsiaIndia
198
13
46
22 18
8
1
29
63
1
52
17
6
North America CIS
China
Europe
Latin America
Coal in global energy consumption
Global consumption of commercial energy, excluding
non - commercial firewood, dung and other waste, totalled
19 billion tonnes of coal equivalent (Gtce) in 2012. Coal, with
a 29 % share, ranked second after oil as one of the major
sources of primary energy (Figure 3). Coal production has
more than doubled since 1980 and, according to the IEA,
coal could replace oil to become the most important source
of energy within the next five years (IEA, 2013a).
For power generation, coal plays a major role in both
developed and emerging economies. In 2012, 41 % of
global power generation was based on coal: 38 % hard
coal and 3 % lignite (Figures 3 and 4).
Global energy trends and the international coal market
Each of the primary energy sources has a different end - use
profile. For oil, the transport sector dominates; for natural
gas, the heating market is important as well as power
generation. Coal is mainly used for electricity generation
and steelmaking, while nuclear energy is used commercially
for power generation alone. Renewable sources are used
both in the heating market and for power generation, while
bio - fuels are gaining ground as transport fuels.
World coal production reached 7.8 billion tonnes in 2012:
6.9 billion tonnes of hard coal and 0.9 billion tonnes of lignite.
In turn, the production of hard coal comprised 5.9 billion tonnes
of steam coal and 1.0 billon tonnes of coking coal. Around one
Figure 2
Global hard coal and lignite reserves
Source: BGR, 2013
Hard coal: 638 Gtce
Lignite: 111 Gtce
Total: 749 Gtce
billion tonnes of coal equivalent (Gtce – data for the end of 2011)
Table 1
Non - renewable energy reserves and resources in the European Union
Gtce reserves resources
Hard coal 16.6 43.0 % 428.6 77.8 %
Lignite 17.4 45.0 % 93.1 16.9 %
Oil 1.7 4.4 % 3.6 0.7 %
Natural gas * 2.8 7.3 % 20.5 3.7 %
Uranium / Thorium 0.1 0.3 % 4.8 0.9 %
Total 38.7 100.0 % 550.7 100.0 %
Source: BGR, 2013
* Natural gas includes conventional natural gas, tight gas, shale gas, coalbed methane, aquifer gas and gas hydrates.

Figure 3
Global primary energy mix and global power generation by primary energy source, 2012
Sources: IEA databases, BP (2013a) and own estimates
Total primary energy supply
19.1 Gtce
Gross power generation
22 500TWh
32 %
21 %
5 %
2 %
10 %
1 %
29 %
41 %
5 %
16 %
11 %
22 %
5 %
Coal
Oil
Natural gas
Nuclear energy
Hydro
Traditional biomass
New renewables
Figure 4
Share of coal - fired power generation in selected countries, 2012 *
Source: IEA databases and own calculations
Coal
Lignite
South Africa *
Poland
Kazakhstan *
China *
Serbia *
Israel
Australia
India *
Greece
Bulgaria *
Czech Republic
Taiwan *
Germany
Indonesia *
South Korea
UK
USA
Denmark
World *
94 %
* 2011 for non - OECD countries
51 % 33 %
80 % 2 %
79 %
76 %
70 %
48 % 22 %
65 % 3 %
56 %
9 % 46 %
9 % 45 %
51 %
21 % 26 %
44 %
42 %
40 %
36 % 2 %
35 %
38 % 3 %

hundred countries use coal in commercial quantities: some are
major producers; others rely on imported coal; but all value the
contribution that coal makes to energy supply (Figure 5).There
are some very large consumers of coal which tend to dominate
the global picture. On an energy basis, the European Union
is the world’s fourth largest consumer of coal after China, the
United States and India. It is noteworthy that in 2012, China’s
annual coal production grew by an estimated 130 million
tonnes, this being almost identical to the EU’s total hard
coal production. Nevertheless, at 433 million tonnes, the EU
remains the world’s largest lignite producer by a wide margin.
Two thirds of all coal produced worldwide is delivered
to power plants, or 90 % in the case of lignite. Other
major customers for hard coal are in the iron and steel
sector, chemical fertiliser manufacture and the process
heating market, including cement works, paper mills, food
processors and other industries. Coal today plays a lesser
role in the heating of buildings, except in several eastern
European countries,Turkey, China and North Korea.That said,
coal - fired district heating and cooling as well as combined
heat and power are important in Scandinavian countries.
In many cases, countries with indigenous coal deposits
have above - average shares of coal - fired power generation,
while countries with insignificant or no reserves have
below - average shares. Exceptions includeTaiwan and Israel
who import all of their hard coal needs (Figure 4). In Japan,
coal is a major economic input, not only to the iron and steel
industry, but also to the power industry. Over one quarter
of electricity supply in Japan relies on imported hard coal.
On an electricity production cost basis, lignite - fired power
plants are very competitive. Similarly, hard coal contributes to
energy supply security at an affordable cost. While the actual
cost varies from region to region and depends on many
factors, the economic contribution of low - cost electricity
from coal and lignite is of great value to economies across
the EU. In addition, coal and lignite mines sit at the centre
of long value chains – creating wealth in other sectors, from
mining equipment suppliers to operators of power plants.
Figure 5
Major coal producing and importing countries, 2012
Source: IEA, 2013b
Production
Imports
China
USA
India
Indonesia
Australia
Russia
South Africa
Germany
Poland
Kazakhstan
Colombia
Ukraine
Turkey
Canada
Greece
Czech Republic
UK
Taiwan
South Korea
Japan 1000 2000 3000 4000 Mt

HUNGARY
A BUCKET - WHEEL EXCAVATOR
STANDING TALL AT 24 m
In order to further improve productivity at the Bükkábrány
opencast mine of Mátrai Erömü in Hungary, a new
compact excavator was designed and built.Taking three
years to build, the excavator’s capacity of 6 700 m3
/ h
is 20 % higher than the known capacity of any other
excavator in the world. In terms of weight and power, the
excavator also sets new standards and since it has been
in operation it has significantly contributed to the mine’s
productivity. The compact design, the two - crawlers and
the large belt wagon allow flexible operations, while the
integrated control and monitoring system guarantees
easy handling. In 2012, the excavator moved some
13.2 million cubic metres, accounting for some 50 % of the
total overburden removed at the Bükkábrány mine.
CZECH REPUBLIC
THE DRAGON OF BŘEZNO
At Březno village, the retired bucket - wheel excavator
KU 800 has become an industrial monument, standing for
the glorious history of modern surface mining in the North
Bohemian brown coal basin. The veteran KU 800, with
a respectable 32 years of service and winner of eleven
overburden extraction records, attracts tens of thousands
of visitors every year to witness the technical and design
skills of Czech brains and hands. This “dragon” symbolises
the technological success of modern and efficient surface
mining. Children from Březno village might also relate the
fantastic fairy tale of the Good Dragon and the Brave Knight,
who saved the village many centuries ago.
CZECH REPUBLIC
MOST HIPPODROME – A FAVOURITE
RECLAMATION PROJECT
The Hippodrome racecourse, located in the 790 - hectareVelebudice
reclamation park in Most is a unique and highly acclaimed project
of the “Czech reclamation school”.The idea was to give new breath
and social importance to this former surface mine. The result is
a unique racecourse, skirted by a 3 370 m in - line skating track, a
show jumping field, training fields, a golf course and a picnic park
for the public. The brown coal companies Vršanská uhelná and
Severní energetická are proud of the outcome: 100 000 visit the
Hippodrome every year, proving the success and originality of the
project.

Coal consumption trends
Since the turn of the new millennium, from 2000 to 2012,
coal use has grown more strongly than any other primary
energy source, in absolute terms, helping to meet a 4.5 Gtce
or 34 % growth in overall energy demand (Figure 6).
New renewables, such as wind, solar and geothermal,
have also grown quickly. However, in absolute terms, their
contribution remains rather limited, amounting to just 1.3 %
of worldwide primary energy consumption in 2012.
Trends in coal use differ by region. In OECD countries, coal
consumption declined slightly since 2000; in the EU, there
was a 14 % drop. In contrast, coal demand in developing
countries has increased dramatically. Growth in non - OECD
countries from 2000 to 2012 amounted to 2.3 Gtce, a
126 % increase. The main driver was China, where coal
consumption increased from 1.0 Gtce in 2000 to 2.8 Gtce
in 2012. Thus, China has accounted for 83 % of the growth
in world coal consumption; India accounted for 12 %.
In the EU, hard coal production has declined from Europe’s
mature production centres whilst volumes of imported coal
have grown significantly. Major coal - consuming countries
in the region are Germany, Poland, the UK, the Czech
Republic, Italy, France, Greece, Spain, the Netherlands,
Bulgaria and Romania. In 2012, Germany was the largest coal
importer in the EU, followed by the UK, Italy, Spain, France,
the Netherlands and Poland (see map inside back cover).
Figure 6
Growth in total primary energy supply, 2000 to 2012
2.5
2.0
1.5
1.0
0.5
0.0
Gtce
O
il
N
aturalgas
N
uclear
H
ydro
O
ther
Coal
International coal trade
Figure 7
Global coal and lignite production and
international coal trade, 1980 to 2012
Source: IEA, 2013b
1980 1985 1990 1995 2000 2005 2010
8 000
7 000
6 000
5 000
4 000
3 000
2 000
1 000
0
Mt
Total coal trade
Lignite
Coking coal
Steam coal
In 2012, international coal trade grew by 11 % to 1 258 million
tonnes or 18.2 % of world hard coal production which
reached 6 926 million tonnes – there is little international
trade in lignite (Figure 7). Of this, 1 082 million tonnes were
transported across the oceans, being the seaborne coal
trade (Figure 8).This data shows that coal is mainly used in
the vicinity of deposits. However, coal from mines with low
production costs and good transport links to sea ports can
be delivered competitively to overseas consumers. Since the
oil crises of the 1970s, the growth in global coal trade has
allowed the world to shift away from an overreliance on oil to
the extent that oil is now rarely used for power generation.
Seaborne trade can be further divided into coking coal
trade and steam coal trade (Figure 9). In 2012, seaborne
steam coal trade grew to 826 million tonnes, with a further
256 million tonnes of coking coal. Overland cross - border
deliveries added an estimated 120 million tonnes to
international coal trade.
The market for steam coal can be subdivided into Pacific
and Atlantic markets, each with different supply patterns
Source: BP, 2013a
renew
ables

Figure 9
International coal trade, 1980 to 2012
Source: IEA, 2013b
1 400
1 200
1 000
800
600
400
200
0
Mt
1980 1985 1990 1995 2000 2005 2010
Seaborne coking coal
Seaborne steam coal
Total hard coal and lignite
(Figure 10). By contrast, the coking coal market is a
more uniform world market, reflecting the small number
of supply countries: principally Australia, the USA and
Canada, but with strong growth potential in the new
entrants Mongolia and Mozambique.
Important exporting countries for hard coal are Indonesia,
Australia, Russia, the United States, Colombia and South
Africa, who together accounted for around 87 % of all
coal exports in 2012 (Figure 11). Resource nationalism
– normally associated with oil and gas exploitation – is
creeping into the coal industry. Indonesia will ban the
export of low quality coal from 2014. In South Africa,
the ruling ANC party has made proposals ranging from
nationalisation of the coal mining industry to greater black
economic empowerment and from a rent tax to export
tariffs. South Africa, like Indonesia, wants to secure coal
for domestic power generation and avoid the premature
depletion of its reserves by coal - hungry China.
The top coal importing countries are China, Japan, India,
South Korea, Taiwan, Germany, the UK, Russia, Turkey,
Italy and Spain, together accounting for 80 % of coal
trade. India’s coal imports are growing quickly, helped by
a government decision in 2012 to temporarily remove coal
import duties. India will likely overtake Japan to become
the world’s second largest coal importing country.
to Far East
54
13
2557
65
31
294
293
49
Russia
117
61
China
9
Canada
34
USA
107
Colombia/
Venezuela
79
Australia
316
Indonesia
304
28
South Africa
76
20
Poland
3
Figure 8
Seaborne trade flows on the international hard coal market, 2012
Source: VDKi, 2013
seaborne steam coal trade: 826 Mt
seaborne coking coal trade: 256 Mt
total seaborne hard coal trade: 1 082 Mt
Imported hard coal makes a significant contribution to the
EU’s security of energy supply and offers a competitive
fuel which can be easily and safely transported and
stocked. In 2012, 17 % of all coal exports were destined
for EU member states. Leading exporters to the EU are
Russia, Colombia, the United States, Australia, South
Africa and Indonesia (Figure 12).

CZECH REPUBLIC
LESS EMISSIONS AND
MORE ELECTRICITY
Czech domestic coal reserves will continue to play a
key role in the national energy mix to make the country
less dependent on fossil fuel imports. ČEZ committed
to refurbish coal - fired power plants and construct new
high - efficiency ones to provide economically attractive
and lower - carbon solutions to meet the country’s power
demand. Prunéřov power plant (3 x 250 MW) will increase
its efficiency from 32.8 % to 40 %, Tušimice power plant
(4 x 200 MW) from 33 % to 39 % and the first supercritical
brown coal - fired unit in the country (660 MW) with a net
efficiency of 42.5 % is under construction at Ledvice. All
three power plants have a long future ahead – providing
affordable, reliable and lower - carbon electricity.
FRANCE
ADVANCED AMINE POST - COMBUSTION
CO2
CAPTURE AT LE HAVRE
BULGARIA
FROM COAL TO GYPSUM
Over one half of Bulgaria’s electricity is generated from coal, mainly
mined by Mini Maritsa Iztok. At the Maritsa Iztok complex, gypsum
is collected as a by-product of the flue-gas desulphurisation
process at two power plants. Gypsum is found in nature, but Knauf
Bulgaria and Technogips can now produce gypsum plasterboard
sheets and gypsum products out of a raw material which is in
fact a waste product from power plant operation rather than from
gypsum mines. This successful symbiosis between lignite mining,
power generation and product manufacturing is a unique solution
that ensures the efficient utilisation of indigenous resources,
protects ambient air and respects the requirements of EU
environmental regulations.
The reduction of CO2
emissions from fossil fuels is one of
the challenges that EDF intends to meet over the coming
years. The carbon capture demonstration plant located
at the coal - fired power plant of EDF in Le Havre aims to
demonstrate Alstom’s proprietary Advanced Amine Process
(AAP) Technology.
The first tonne of CO2
was captured on 11th July 2013 and
approximately 25 tonnes of CO2
will be captured every day.
The primary test objectives are the validation of key process
performance parameters such as CO2
capture efficiency,
thermal degradation and related environmental emissions as
well as material selection for key components. Additionally,
the robustness and behavior of the AAP technology under
transient operating modes such as load variations and “cold”
and “hot” start - ups and shut - downs will be examined as
well as of course the economic viability of the process.

Figure 10
Major steam coal flows within and between the Atlantic and Pacific markets, 2012
Atlantic Market: 226 Mt Pacific Market: 600 Mt
Supply: 279 Mt
USA
Russia
Colombia
South Africa
Venezuela
Poland etc.
Demand: 226 Mt
EU27
Eastern Europe
Mediterranean
North, Central &
South America
etc.
Demand: 600 Mt
China
Japan
India
South Korea
Taiwan
etc.
Supply: 547 Mt
Australia
Indonesia
Russia
South Africa
Vietnam
China etc.
69 Mt
16 Mt
210 Mt 531 Mt
Source: VDKi, 2013
Figure 11
Top coal exporting countries, 2012
Source: IEA, 2013b
Indonesia
Australia
Russia
USA
Colombia
South Africa
Canada
Kazakhstan
Mongolia
Vietnam
North Korea
China
Poland
Ukraine
Czech Republic
Mozambique
New Zealand 100 200 300 400 Mt
Steam coal
Coking coal

Figure 12
Coal imports into the EU by source country, 2011
Source: DG Energy, 2013 Note: the source country of 4.0 % of coal imports is not specified in customs data.
Canada 2.2 %
Ukraine 2.2 %
Norway 0.6 % Venezuela 0.5 %
Kazakhstan 0.3 %
China 0.1 %
Others 0.1 %
Russia 26.1 %
Colombia 23.9 %
USA 18.1 %
Australia 8.9 %
South Africa 8.0 %
Indonesia 5.2 %
200 Mt
Recent coal market developments
Despite the strong growth in coal demand, the global
economy remains fragile and many predict a slowdown
in Asia as government stimulus spending is reduced.
Demand for commodities such as iron ore, coking coal
and steam coal may stagnate as infrastructure projects are
delayed or cancelled and economic growth slows. Already
in 2013, coal markets have become “oversupplied”, putting
downward pressure on prices. There are various reasons for
this oversupply, including an increase in US coal available
for export during the summer months due to a fall in US
natural gas prices and a devaluation of the Indian rupee
against the US dollar. The latter has put coal exporters to
India under mounting pressure to reduce prices, pressure
felt most acutely by Indonesian producers who supplied
an estimated 78 % of India’s steam coal imports in 2012.
Significant upward swings in coal demand have been seen
in Europe where high prices have made natural gas very
uncompetitive and the German nuclear phase out created
an unexpected demand for alternatives such as coal and
lignite. The German Energiewende progressed with sharp
rises in power generation from solar PV and wind – up
37 % in 2011 and 8 % in 2012 – leaving new gas - fired power
plants lying idle. In Japan, following the ongoing accident
at Fukushima nuclear power plant and temporary closure
of nearly all Japan’s other nuclear plants, there has been no
growth in coal demand. Demand - side measures mean that
electricity demand fell 7 % between 2010 and 2012.
In the absence of sufficient coal - fired generation capacity –
some was damaged by the tsunami in 2011 – this reduced
demand has been met with the greater use of oil and
gas for power generation at great cost to the Japanese
economy and contributing to the high gas prices seen
around the world.
More than ever before, the coal market now depends on
events in the Far East. China imported 289 million tonnes
in 2012, overtaking Japan to become the world’s biggest
coal importer and absorbing 23 % of internationally traded
coal into a country which now consumes just over half
of all the coal mined around the world. Some forecasts
show China’s coal imports rising to an unimaginable one
billion tonnes by 2030, coming mostly from Australia and
Indonesia.
Surprisingly, US and Colombian coal now finds buyers in
Asia, despite the long transport distances and sometimes
difficult logistics. South African exporters also now ship
to Asia in preference to Europe, although have failed to
deploy the full capacity of the country’s export terminals.
These new coal trade flows have emerged because sea
shipping rates remain at historic lows. The Baltic Dry Index
– a measure of shipping rates – has been below 2 500
since November 2010, compared with a peak of 11 793

at the height of the economic boom in May 2008 when
the rate for shipping coal from South Africa to north - west
Europe rose to above 60 US$ / tonne. During much of
2012, the same rate was below 10 US$ / tonne. With new
vessels still being delivered into an already oversupplied
market, shipping rates are likely to remain low. Moreover,
new or expanded trade routes are opening up with the
expansion of the Panama Canal and thawing of the
Northwest Passage and Northern Sea Route. How these
affect international coal trade remains to be seen, but we
can be sure that trade will continue to grow, matching
coal producers and consumers in perhaps the world’s
most dynamic and competitive market.
The shale gas revolution in the United States has had a
significant impact on coal demand in that country. Cheap
natural gas – averaging one quarter of EU prices in 2012
– has displaced coal for power generation leading to coal
mine closures, corporate bankruptcies and greater efforts
to export coal. Since 2010, US coal consumption has fallen
by 128 million tonnes or 13 % to 822 million tonnes –
a 20 - year low – whilst exports grew 54 % to 114 million
tonnes over the same two - year period. Europe in particular
has benefitted from competitive supplies of US coal: in
2012, the US became the second largest coal exporter to
the EU after Russia. There are various reasons to question
the long - term durability of this development:
• US natural gas prices are unlikely to remain so much
lower than elsewhere in the world once LNG export
terminals open and link the now isolated US market
with international gas trade.
• Continued low international coal prices would see US
producers exit the international market: their production
costs are at the upper end of the cost curve for
internationally traded coal.
• The production profile of shale gas formations depends
on a programme of continuous drilling and fracturing
(“fracking”). Decline rates for individual wells are very
steep – 65 % to 85 % in the first year – refracking helps,
but more and more wells are needed to maintain
production.
More generally, there is much uncertainty on the potential
of shale gas. Resource estimates are often based on
patchy data because, outside of North America, shale
gas exploration is still in its infancy. Even when data is
available, the different methodologies and assumptions
used to interpret that data have led to wildly varying
resource estimates: varying by a factor of 100 in the case
of Poland. Hence, any estimates must be treated with
caution, at least until they are confirmed by commercial
production.
Coal pricing
Price formation on the world coal market was for a long
time dominated by non - transparent long - term contracts.
One reason for this is the non - homogenous nature of hard
coal with quality defined by a number of parameters (e.g.
calorific value, ash, moisture, volatile matter, sulphur and
chloride). Delivery location also determines price since
freight costs can be significant. Typical source and delivery
locations for pricing purposes are Richards Bay in South
Africa, Newcastle in Australia, Qinhuangdao in China
and the ARA ports in north - west Europe (Amsterdam,
Rotterdam and Antwerp).
Over the years, greater tolerance to coal quality has
become possible due to ongoing developments in
power plant technology and greater use of flue gas
desulphurisation. Today, coal price indices, such as
those published by Argus, McCloskey and Platts, refer
to standard locations and specifications, and contracts
include price adjustments for coals which vary from the
norm. In this way, the prices of individual coal trades
can be fed into the calculation of benchmark or reference
price indices.
Today, the world market for hard coal is characterised
by strong competition between many suppliers, large
and small. The leading twenty coal companies represent
about one third of global coal production and about half of
international coal trade. The four largest coal exporters –
BHP BILLITON, GLENCOREXSTRATA, ANGLO AMERICAN
and RIO TINTO – account for about one quarter of
international trade.
Establishing a price no longer depends exclusively on
bilateral negotiations and contracts, although these are
still important. The availability of reference spot prices for
different types of coal and different countries or regions
not only increases transparency, but also makes trade in
futures and derivatives possible. In the steam coal market,
as in other commodity markets, it is now possible to
manage risk flexibly and affordably, thanks to derivatives.
In practice, this can take place on commodity exchanges
such as Nymex and EEX, via exchange - traded funds,
on electronic trading platforms such as globalCOAL, as
well as on the over - the - counter market. This trend has
encouraged the entry of new market participants, thus
deepening market liquidity. In the coking coal market,

annual contract negotiations – typically led by Australian
producers and Japanese steel mills – have moved
to a broader participation in the setting of quarterly
“benchmarks” coupled with monthly contracts and
a growing spot market.
Over the last one hundred years or more, a number of
economic cycles can be seen reflected in the real price
of steam coal on the international market (Figure 13).
The global economic crisis interrupted what was described
by some as a “super cycle” with booming demand for
products from emerging economies around the world
as well as from their new middle classes. Coal prices
today still reflect a period of tight supply and it is difficult
to predict future prices. However, in its outlooks, the
IEA assumes real coal prices will rise steadily over the
next twenty years to reach 10 % to 20 % above the 2012
average.
Imported hard coal is a very affordable source of energy.
Over the last 25 years, coal has been consistently cheaper
than both oil and natural gas on an energy basis (Figure
14).The strong demand for energy commodities since
around 2000, driven by China, has seen a quadrupling of
oil and gas prices. Over the same period, coal prices have,
on average, remained at below half the level of oil and gas
prices.
Unlike for hard coal, there is no free - market price
formation for lignite used in power generation and very
little international trade – just 3 million tonnes in 2012.
This is because its low energy density makes transport
uneconomic over longer distances. For this reason, it is
common to build lignite - fired power plants adjacent to
lignite mines such that producer and consumer co - exist
in a captive market and form a single economic entity.
Lignite is then most economically transported by
dedicated infrastructure – typically a conveyor belt –
delivered directly to nearby power plants under, for
example, 50 - year contracts. Lignite mining and use is
a stable, long - term business.
Figure 13
Australian steam coal real price index, 1901 to 2012
400
200
100
50
1900
end WWI
Sources: Reserve Bank of Australia, 2007;
IEA, 2013b; own estimates using US CPI
1910
1920
1930
1940
1950
1960
1970
1980
1990
2000
2010
end WWII
6 - Day War
China joins WTO
(1901 = 100)
Figure 14
EU import prices for coal, oil and natural gas, 1990 to 2012
Sources: McCloskey, 2013; IEA, 2013b; BAFA, 2013
1990 1995 2000 2005 2010
400
350
300
250
200
150
100
50
0
€ / tonne of coal equivalent
low sulphur fuel oil
(Rotterdam)
EU pipeline gas imports
EU steam coal imports
Global outlook for coal
The future of coal looks assured with rising demand all
around the world: the IEA forecasts that demand will
grow by 17% between 2012 and 2017 (IEA, 2013a).
On current trends and with no major technological
changes, coal demand is likely to increase by 50% over
the next 25 years. However, many forecasters try to marry
the competing challenges of securing global energy supply
and reducing global greenhouse gas emissions. This leads
to scenarios in which coal’s role is significantly curtailed.
For example, the IEA World Energy Outlook 2012 presents
three future energy scenarios:

SLOVENIA
ŠALEK VALLEY – WHERE COAL
MINING STANDS FOR WELFARE
AND PROSPERITY
The mining company Premogovnik Velenje in Slovenia
provides lignite to the nearby Šoštanj power plant,
producing electricity for the entire region and covering 31 %
of the country’s electricity needs. Thanks to lignite mining,
the small town became the fifth largest city in Slovenia in
less than fifty years. Premogovnik Velenje takes seriously
its commitments in the field of social responsibility and
the rehabilitation of mining sites in order to marry industrial
activity and high living standards.
POLAND
SKIING ON OVERBURDEN – THE
HIGHEST PEAK IN CENTRAL POLAND
Kamieńsk mountain is the highest peak in Central Poland.
It is man-made – built of overburden from the lignite mine
Bełchatów. Today’s forested mountain is the result of a
comprehensive rehabilitation plan which transformed this
industrial location into an attractive summer and winter
tourist resort. The main attraction is a 760 - metre long
ski slope with one chairlift and two ski lifts, as well as an
ultra - modern toboggan run and several bike trails.
NORWAY
ENABLING SCIENCE IN THE ARCTIC CIRCLE
Store Norske mines coal 1 250 km from the North Pole in some
of the most challenging conditions: coal can only be shipped once
sea ice melts in late summer. This unique location attracts many
scientists and engineers. Only here is there a single ground station
that can stay in contact with the polar - orbiting satellites that map
the world and measure global temperature changes. The Svalbard
Global Seed Vault provides a safety net against losing crop
diversity. The NASA rover that is now exploring Mars was tested
in the arctic desert of Svalbard. All of this is made possible only
because of the mine, its infrastructure and the local community.

Global energy trends and the international coal marketThe macro-economic value of coal in Europe
SLOVENIA
THE WORLD’S BEST MINING
OF THICK COAL SEAMS
Velenje coal mine in Slovenia – with more than 135 years
of mining tradition – uses highly developed technologies.
Exploiting one of the thickest lignite seams in the world,
the company has developed a unique and patent - protected
method for extracting thick coal seams. The basic approach
at Velenje coal mine is to extend coal extraction above the
protected area at the face. Natural forces break and crush
the seam. Thanks to modern mining equipment, especially
hydraulic supports and advanced chain conveyors, the
company uses a lower number of wider longwall faces.
The method is producing enviable results, placing the coal
mine at the global forefront of underground coal mining.
POLAND
PROTECTING THE UPPER REACHES
OF VISTULA RIVER
Since 2002, Kompania Węglowa has worked on the
protection of the Vistula river in Poland against salt water
from coal mines. The protection scheme is based on a
temporary reservoir of salty mining water followed by
regulated inflow of this water to the river in order not to
exceed the acceptable limits for chloride and sulphide
concentrations. During periods of low water levels, the
most salty mine water is stored in the Wola reservoir until
periods of high level water, when it can be safely released.
POLAND
INTERACTIVE TRAINING WITH
VIRTUAL SIMULATION
AND ON - LINE DOCUMENTS
Mining is not only about hard and hazardous work. Nowadays,
advanced ICTs are vital to underground operations and also in the
field of training. Interactive training material, including accident
scenarios as well as advanced applications that aid with manual
activities, are successfully used at underground mines in Poland.
Wisla
Sola
Skawa
Biala
Pszcynka
Gostynia
Mleczna
Pot.G
oław
iw
ckiPrzem
sza
ZGE
Sobieski
Jaworzno
ZGE
Janina
KWK
Wesoła
Zbiornik
WOLA
KWK
Piast
KWK
Ziemowit
PG Silesia
KWK
Brzeszcze
The "Mała Wisła" scheme
participants in the protection scheme
control point for water quality
mine water storage reservoir
Commissioned: 2008
Total investment: c. € 10 million
Ecological benefits: balancing salt concentration in the Vistula River and
avoiding the discharge of 998 000 tonnes of salt
stored in former mining excavation
Vistula River Ground level = + 244 m asl
operational part of mine water
reservoir ~ 1.9 million m3
4 deep - well pumps
+ 50 m asl
- 150 m asl
irretrievable mine water
storage ~ 17 million m3

• A Current Policies Scenario or status quo scenario in
which energy and climate policy frameworks remain
unchanged.
• A New Policies Scenario which assumes political
promises and announced plans to limit greenhouse gas
emissions are met.
• A 450 Scenario in which the atmospheric concentration
of greenhouse gases is limited to 450 parts per million
of CO2
equivalent to meet the objective of limiting global
temperature rise to 2 °C compared with the pre - industrial
level.
The Current Policies Scenario is the most realistic in that
it has been, over recent years, the scenario which closest
matches actual outcomes. The 450 Scenario reflects the
stated commitment of G8 leaders to address the climate
challenge. However, it is a virtually impossible goal, unless
draconian action is taken to stop the use of fossil fuels.
The New Policies Scenario is closest to the assumptions
made by the EU institutions that other countries will follow
the EU’s progressive energy and environment policies.
Worldwide primary energy consumption increases by 35 %
to 24.6 billion tonnes of coal equivalent in 2035 (an annual
average increase of 1.2 % from 2010). 93 % of this increase
occurs in non - OECD countries while energy demand in
OECD countries increases only slightly. Coal demand rises
by 21 % over the outlook period, but this global figure
masks a 53 % decline of coal use in the EU.
Most forecasts and outlooks mirror the IEA’s Current
Policies Scenario. For example, BP expects global coal
supply to grow by an average of 1.4 % each year from
2010 to 2030 to 6.7 Gtce by 2030, a 33 % increase, with
strong growth in India and other non - OECD countries
offsetting declines in the OECD. Growing imports drive
further expansion and integration of global coal markets.
In the EU, production and consumption of energy
remains flat.
Coal demand declines in the OECD (by 0.8 % p.a.
2011 - 2030), but continues growing in the non - OECD
(1.9 % p.a.). China remains the largest coal consumer
with over half of global consumption (52 %), while India
(12 %) overtakes the US to become the second largest in
2024. Together, China and India account for 92 % of global
coal growth to 2030. As the focus of China’s economic
development shifts from rapid industrialisation and
infrastructure development to growth based on services
and light manufacturing, its coal demand growth slows
rapidly from 9 % p.a. in 2000 - 2010 to 3.5 % p.a. this
decade and 0.4 % p.a. in 2020 - 2030. India’s coal demand
growth slows more gradually, from 6.5 % p.a. in 2000 - 2010
to 3.6 % p.a. in 2011 - 2030, as energy efficiency gains
partially offset rising energy demand for industrial and
infrastructure expansion.
The growth of global coal consumption in power
generation slows from 3.6 % p.a. in 2000 - 2010 to 2.4 %
p.a. in 2011 - 2020 and 0.4 % p.a. after 2020. In the
OECD coal use in power is already in decline (- 0.2 %
p.a. 2000 - 2010); this decline accelerates to - 1.2 % p.a. in
2020 - 2030. In non - OECD countries, the growth of coal
use in power generation slows, from 7.7 % p.a. 2000 - 2010
to 1.0 % p.a. after 2020. As a result, coal’s share in fuels
used for power generation declines from 44 % in 2020 to
39 % in 2030 – just a little lower than today.
Overall, there is a clear disjoint between what politicians
espouse and the actual outcome that results from the
individual decisions of billions of energy consumers.
If there is a strong political will to tackle climate change,
then perhaps the IEA’s optimistic New Policies Scenario
will materialise. BP’s outlook looks more likely since
it is based on an economic assessment of the known
alternatives and does not depend on political promises
being delivered in a tight timeframe during times of
austerity in many countries. It is likely that the energy
consumer will have the final say which means that our
energy future must be not only clean and secure, but also
affordable.
Figure 15
Future global coal demand to 2030 and 2035
Sources: BP, 2013b; IEA, 2012
1990 2000 2010 2020 2030
8 000
7 000
6 000
5 000
4 000
3 000
2 000
1 000
Mtce
IEA range of scenarios
BP Energy Outlook 2030
IEA New Policies Scenario

The socio - economic value of
a sustainable European coal industry
The key advantages of coal are security of supply and
favourable prices compared with competing energy
sources. When indigenous supplies can be exploited,
the use of coal adds value along the entire supply
chain: from coal mine to electricity consumer. This
underpins economic development and employment.
Policy makers must balance these socio - economic
benefits with environmental protection and climate
objectives. Here, technological progress allows coal to
take its rightful place alongside other energy sources
each of which has its own particular set of advantages
and disadvantages.
Employment in the European coal industry
In 2012, across the EU, 130 million tonnes of hard coal
and over 430 million tonnes of lignite were mined. Mining
this coal employed more than 240 000 people, some at
integrated mine and power plants. In the greater Europe,
includingTurkey and Ukraine, this number rises to almost
600 000 people (Table 1). Adding the indirect jobs supported
by coal mining leads to a total of well over one million people
whose livelihoods depends on the coal industry.
These jobs are frequently in economically less advantaged
regions where coal extraction and utilisation is the only
wealth - creating activity. In total, with its capital investments,
operating expenditures and payment of salaries and
taxes, the coal industry makes an important contribution
to the prosperity of Europe’s mining regions and national
economies.
Table 1
Manpower in the European coal industry 2010 and 2012
2010 2012
Hard Coal Lignite Total Hard Coal Lignite Total
Bosnia and Herzegovina - 13 000 13 000 - 11 500 11 500
Bulgaria 4 600 8 200 12 800 3 500 7 800 11 300
Czech Republic 13 700 10 200 23 900 12 900 9 100 22 000
Germany 24 200 16 700 40 900 17 600 16 600 34 200
Greece - 8 400 8 400 - 7 500 7 500
Hungary - 2 400 2 400 - 2 100 2 100
Poland 114 100 16 300 130 400 113 000 15 000 128 000
Romania 8 800 13 500 22 300 6 000 15 000 21 000
Serbia - 12 500 12 500 3 900 12 300 16 200
Slovakia - 3 900 3 900 - 3 700 3 700
Slovenia - 1 800 1 800 - 1 600 1 600
Spain 5 400 - 5 400 3 400 - 3 400
Turkey 18 500 37 000 55 500 18 500 37 000 55 500
Ukraine 271 000 - 271 000 273 800 - 273 800
United Kingdom 6 000 - 6 000 5 800 - 5 800
Total 466 300 143 900 610 200 458 400 139 200 597 600
Source: EURACOAL

1 Indigenous production of 239 Mtce or 279 Mt (6 000 kcal / kg) at a price of 90 US$ / tonne.
2 In 2012, the cost of importing natural gas into Germany was 11.03 US$ / mmBtu (BAFA, 2013) which is equivalent to 239 € / tce.
The annual cost of replacing indigenous coal production with imported natural gas would therefore be around € 57 billion.
Figure 1
EU energy import dependence, 2005 and 2011 with projections for 2020 and 2030
2005 2011 2020 2030
100 %
80 %
60 %
40 %
20 %
0 %
2005 2011 2020 2030 2005 2011 2020 2030
Source: European Commission, 2013
Oil Natural gas Coal
Access to energy is the very basis of economic and social
progress – leading to prosperity and social harmony.
Indeed, the founding fathers of the European Union sought
peace and prosperity when they signed the Treaty of Paris
to establish the European Coal and Steel Community in
1952. This treaty promised energy consumers a common
market for coal so that this valuable resource would be
distributed as rationally as possible. In contrast, energy
poverty causes real hardship in many regions of the world.
Supplying EU industry and households with an affordable
source of energy that has stable and predictable prices
in the long - term is therefore one of the most important
reasons to justify coal and lignite mining in the EU. This is
of major significance, especially to those countries that are
well endowed with these energy resources and should not
be overlooked by those that are not.
The coal industry, from extraction to power generation,
represents a completely secure value - added industrial
supply chain, creating economic wealth and prosperity
in the EU. In this context, the impact of coal and
lignite mining to alleviate the already high balance of
payments deficit of various EU member states cannot be
understated. Beyond Europe, the technologies developed
by the European mining and power plant equipment
suppliers also contribute to improving the efficiency of
coal production, preparation and use in other regions of
the world.
The annual value of EU - wide coal and lignite production,
based on its calorific value and on international hard coal
prices at the beginning of 2013, totals more than € 25
billion.1
If the quantity of coal mined in the EU were to be
replaced by natural gas, then the annual cost would be
almost € 60 billion.2
The EU has insufficient indigenous
natural gas production to meet its existing gas needs and is
67 % dependent on imports, so this entire sum would leave
the EU and weaken the region’s economy (Figure 1).
Added value from coal mining in the EU
The socio - economic value of a sustainable European coal industry

Security of supply from indigenous coal and reliable coal imports
Households and especially industry depend on secure
energy supplies without interruption. The contribution
of lignite and hard coal mining to the security of energy
supply in Europe is very significant. EU import dependence
for solid fuels was 41 % in 2011, less than half that for oil
and gas (Figure 1). Much of the energy imported into EU
member states comes from a relatively small number of
producing countries, with Russia, Norway, Saudi Arabia,
Algeria and Colombia being the most significant. However,
those countries supplying hard coal present an overall
lower risk than those countries supplying oil and gas.
A base supply of indigenous energy raw materials in the
EU clearly reduces any potential weaknesses in security
of supply. Coal and lignite mined in the EU in 2012 covered
about 10 % of EU primary energy demand. Indigenous coal
and lignite remain the most important indigenous energy
supplies in the EU, exceeding natural gas production in
terms of energy supplied by 20 %.
Sustainable coal use in the long term
For some years, the environmental debate has focused
on global climate protection. The strategy to reduce CO2
emissions from coal use begins with more efficient
state - of - the - art power plants, assumes the further
development of power plant technology to reach higher
efficiencies, and leads ultimately to power plants fitted
with CO2
capture and storage. Installations with CO2
capture should be commercially available by 2020,
reducing CO2
emissions from coal - fired plants by around
90 %. Central to the wide use of this technology is an
investment - friendly legal framework and public support
for a CO2
transport and storage infrastructure.
Economic competitiveness from electricity
An important indirect benefit of coal is its contribution to
competitive electricity tariffs. Tariffs are a key factor for
the location of industry, especially for energy - intensive
industries looking to make investments at existing or new
sites. Any tax or duty on coal and lignite therefore not
only costs direct jobs in the coal industry, but indirectly
threatens many others across those industries burdened
by higher energy costs. Recent data shows that electricity
prices in Europe have become less competitive (Figure 2).
This is a worrying trend that can be reversed by ensuring
that there is true inter - fuel competition between fuel
sources for electricity generation: that means between
coal, natural gas, nuclear, hydro and new renewables.
Figure 2
Evolution of end - user electricity price index for industry
2005
150
140
130
120
110
100
90
80
(taxes excluded, 2005 = 100)
2006 2007 2008 2009 2010 2011 2012
OECD Europe Japan United States
Source: IEA detabases, 2013
The socio - economic value of a sustainable European coal industry
Environmental impacts associated with coal are well
understood. Inevitably, coal mining interferes with the
environment, in common with the mining or production
of any other mineral; however, ecological impacts are
increasingly well addressed during mine planning,
operation and landscape restoration. The maritime
transport of coal is safe and it can be easily stocked
in large quantities. Emissions from coal use, such as
sulphur dioxide, NOX
and dust, can be almost eliminated
by commercially available pollution control equipment.
In the EU, most coal - fired power plants are now
equipped with highly efficient flue - gas desulphurisation.

EUROPEAN UNION
NEMAEQ – A PROJECT THAT MAKES
EUROPEAN HARD COAL MORE
COMPETITIVE
Coal mining in Europe occurs at depths of up to 1 400 metres
where both the rock temperature and pressure are
significantly greater than in the shallow deposits in Australia
and America. To compete, European coal producers need
to be highly productive which is only possible through
improved mechanisation of all processes and optimal
automation of the mining equipment. NEMAEQ was a
project funded by the Research Fund for Coal and Steel
(RFCS) aimed at developing a fully automatic shearer loader
system which cuts and loads the coal without major manual
interaction; including also load dependent regulation,
coal / rock distinction, collision avoidance and appropriate
control and data processing technologies.
EUROPEAN UNION
LIGPOWER – COST - SAVING
CLEANING IN POWER PLANTS
Lignite is a competitive energy source in the power generation of
many European countries. However, the specific properties of lignite
lead to relatively low softening and melting temperatures, resulting
in deposits forming in the boiler during combustion. LIGPOWER
was a three year Research Fund for Coal and Steel (RFCS) project
aimed at improving the cleaning equipment and finding new
easier - to - clean heating surfaces with the goal of enhancing the
availability and competitiveness of lignite as an energy source.
GERMANY
WHERE ELECTRICITY IS GENERATED FROM MINE GAS
The German Saarland region operates the world’s largest mine
gas combined heat and power plant at Völklingen - Fenne with
a capacity of 42 MW. The Saarland has a 110 km mine gas grid
connecting local gas extraction stations with mine gas - fired
combined heat and power plants. Mine gas from active hard coal
mines is extracted during production and pumped to the surface
through a series of pipes. It is then compressed before being
delivered to combustion plants. Even after a mine closure, mine
gas can still be captured and pumped to the surface, avoiding the
uncontrolled relase of gas.
gas plants
gas consumers
gas engines
Ownership of mine gas pipelines
STEAG New Energies GmbH
enovos
connecƟon to pilot fuel cell plant
FVS Lebach
STEAG
KW Weiher
GAV Nordschacht
GAV
Kohlenwald
GAV
Hangard
GAV
Allenfeld
GAV
Reden
STEAG
Wellesweiler
STEAG Quierschied
gasometer
STEAG
KW BexbachGAV
Itzenplitz
Wellesweiler
gas turbine
GMA
Camphausen
DSK Hirschbach
GAV
Erkershöhe
GAV Ludwigstollen
GMA Velsen
STEAG KW Fenne
GMA
Weiher Saarstahl
Neunkirchen
GAV
Camphausen
STEAG
Camphausen
GAV
Alsbach
Gipswerk Knauf
STEAG Velsen
BRGM
AVA Velsen
GMA Fenne
GAV Fürstenhausen
Neuwaldstraße
GAV
Delbrück Saarstahl
Burbach
Luisenthal pilot
fuel cell plant
GAV
Kallenberg
GAV: gas sucƟon pump / gas compressor plant
GMA: mine gas engine plant
BRGM: Bureau de Recherches Géologiques et Minières
(French Geological Survey)

Brown coal
Bulgaria’s brown coal deposits are mainly located in the
western part of the country (Bobov Dol, Pernik and Pirin
coalfields and the Katrishte deposit) and near the Black
Sea (Cherno More coalfield). In 2012, the total production
of brown coal, extracted from both underground and
opencast mines, amounted to 2.1 million tonnes.
Bulgaria
Cherno More
Maritsa
lignite field
Pirin Basin
Bobov DolBobo
PernikPernnik
Sofia Basin
Elhovo Basin
Dobrudzha BasinasBaBhazhDobrob udz
Mo MCherno
Balkanbas
Svoge
sinsin
SvogeS
n
ol
Danube
Yantra
Tundzha
Maritsa
M
esta
Struma
Iskar
Sofia
Pleven
Varna
Stara Zagora
Blagoevgrad
Vidin
General data Unit 2012
Population million 7.3
GDP € billion 39.7
Hard coalLignite
Brown coal Anthracite
Hard coal and
Anthracite
Hard coalLignite
Hard coal and
Anthracite
The mining industry is of outstanding importance to
Bulgaria and it has become one of the best developing
industries over the last few years. The mining sector
has almost reached the average EU labour productivity,
considerably surpassing average productivity in other
sectors. The mining industry is an important branch and
one of the main driving forces of the country`s economy.
Over the last few years the Bulgarian mining industry has
attracted considerable foreign and Bulgarian investors and
several companies are investing in world best practices in
the fields of exploration, extraction and processing.
Bulgaria has great resource potential and provides jobs to
highly qualified and experienced specialists contributing to
the social and economic development and welfare of the
mining municipalities. Nevertheless, the long permitting
procedure from the initial investment assessment to
exploration and a lack of clear regulations on extraction and
planning are slowing down the industry’s projects. There
are good prospects for the introduction of leading world
and European technologies in order to further enhance
efficiency in the field of extraction and processing.
The major tasks of the Bulgarian mining industry are
the sustainable development of the mining regions,
environmental protection and restoration, improvement
of safety standards and the improvement of vocational
training.
Lignite
Opencast lignite mining is mainly carried out in the mines
of MINI MARITSA IZTOK EAD, whose production accounts
for 95.7 % of the total inland output. The entire mines area
accounts for some 240 square kilometres and besides
being the largest mining site in South East Europe, MINI
MARITSA IZTOK EAD is also the biggest employer in
Bulgaria. The company supplies four thermo - electric power
plants with its own lignite: the state - owned Maritsa East 2
EAD thermal power plant (TPP) (1 600 MW) and the
privately - owned CONTOURGLOBAL Maritsa East 3 TPP
(908 MW), AES Galabovo TPP (670 MW) and BRIKEL EAD
(200 MW). MINI MARITSA IZTOK EAD also supplies lignite
to Maritsa 3 TPP in Dimitrovgrad, which has an installed
capacity of 120 MW.
The company plays an important role in securing national
energy security, and guaranteeing energy independence
for Bulgaria. 40 % of the generated electric power is
provided by lignite from MINI MARITSA IZTOK EAD.
The company is part of the BULGARIAN ENERGY
HOLDING EAD.
Other lignite mining companies are Beli Bryag mine (1.7 %),
Stanyantsi mine (1.6 %) and Chukurovo mine (1.0 %).
Bulgaria

Bulgaria
VAGLEDOBIV BOBOV DOL EOOD mines the Bobov Dol
coalfield, which is the largest deposit of brown coal in the
country. There are significant coal reserves and resources
here, amounting to some 100 million tonnes. Coal mining
is carried out at one opencast and two underground mines.
In 2012, a total of 1.1 million tonnes of brown coal was
produced by the three mines owned by VAGLEDOBIV
BOBOV DOL. The produced coal is mainly supplied to the
nearby 210 MW Bobov Dol EAD power plant which was
retrofitted with flue gas desulphurisation in 2012 to comply
with EU legislation. About 10 % to 12 % of coal mined by
VAGLEDOBIV BOBOV DOL is used by households.
OTKRIT VAGLEDOBIV MINES EAD, another private
company, owns two opencast mines in the Pernik coalfield
where it extracted 1.1 million tonnes of brown coal in 2012.
BALKAN MK carries out underground coal mining in the
Oranovo coalfield with some 30 million tonnes of brown
coal reserves and a production output of 0.7 million tonnes
per year. The brown coal is supplied mainly to the Bobov
Dol power station.
Other small privately owned mines are the Vitren mine
located in the Katrishte deposit, with an annual output of
some 0.1 million tonnes, and Cherno More mine in the
Black Sea coalfield, with an annual output of 0.25 - 0.3 million
tonnes.
Hard coal output is insignificant (14.1 thousand tonnes) and
its extraction is carried out by BALKAN 2000 MINES EAD.
Energy Policy
The liberalisation of the electric power market in Bulgaria
is being carried out in line with the requirements of EU
legislation. In practice, this is a step - by - step process
with the aim of creating the necessary conditions for
competition among electric power generators, as well as
to give consumers the opportunity to choose their supplier.
The Bulgarian energy sector is relatively small on a global
scale, but it is of great significance to the country`s
industrial capacity. It mainly encompasses electricity
generation and oil and gas transport to Western markets.
The sector is traditionally considered to be of strategic
importance to the economic development of the
country and to national energy security, which to some
extent explains the large investments in new capacity,
rehabilitation of old power plants and expansion of the
power supply grid made over the last 7 - 8 years.
Saleable coal quality
Hard coal calorific value kJ / kg 12 140 - 13 400
Lignite calorific value kJ / kg 6 720
Hard coal ash content
(black and brown) % a.r. <26
Lignite ash content % a.r. 15.97
Hard coal moisture content
(black and brown) % a.r. <16
Lignite moisture content % a.r. 52.9
Hard coal sulphur content
(black and brown) % a.r. <2.7
Lignite sulphur content % a.r. 2.28
Coal imports / exports
Hard coal imports Mt 2.3
Primary energy consumption
Total primary energy consumption Mtce 25.8
Hard coal consumption
(black and brown) Mt 4.4
Lignite consumption Mt 30.4
Power supply
Total net power generation TWh 42.9
Power imports / (exports) TWh 2.4 / (10.6)
Total power consumption TWh 34.6
Power generation from lignite TWh 19.9
Capacity of lignite - and
brown coal - fired generation MW 5 917
Employment
Direct in lignite and
brown coal mining
thousand 11 300
Other lignite - and
brown coal - related *
thousand 67 100
Coal resources and reserves Unit 2012
Resources hard
(black and brown) coal Mt 598.4
Resources lignite Mt 3 386.8
Reserves hard
(black and brown) coal Mt 254.7
Reserves lignite Mt 1 600.2
Primary energy production
Total primary energy production Mtce (2011) 17.7
Hard ( black and brown) coal
(saleable output) Mt 2.1
Lignite (saleable output) Mt 30.4
* e.g. in power generation, equipment supply, services and R&D

Czech Republic
Coal is the only significant indigenous energy resource
in the Czech Republic. The country’s economically
recoverable coal reserves have been estimated at some
2.33 billion tonnes. Brown coal, which accounts for
more than 73 % of these resources, is mainly produced
in north - western Bohemia, whilst hard coal is mined in
northern Moravia. Significant quantities of hard coal are
exported to Austria, Slovakia and Poland.
Primary energy consumption, which amounted to
60.8 Mtce in 2012, was supplied as follows: 40.6 % coal
(total 24.7 Mtce, of which hard coal 5.9 Mtce and brown
coal 18.8 Mtce), 15.8 % natural gas (9.6 Mtce) and 20.4 %
oil (12.4 Mtce). This primary energy mix is supplemented
by nuclear energy with an 18.6 % share (11.3 Mtce), as
well as by renewables and hydroelectric power, which
together account for some 6.5 % (4.0 Mtce), and 0.5 %
(0.3 Mtce) other fuels and - 2.4 % (- 1.5 Mtce) as net exports
of electricity.
The Czech Republic’s dependence on energy imports has
been quite modest to date; 28.5 % of energy demand
is met by imports. However, imports are structurally
unbalanced. The country’s dependence on oil is about
95 %, and similarly for natural gas. A number of direct and
indirect measures must be adopted to prevent any further
increase in energy imports, including: increased energy
efficiency, the promotion of renewable energy sources
in areas where their use is effective and helps to reach a
13 % share in final energy consumption in 2020 and the
efficient use of indigenous solid fuel resources, mainly
brown coal.
In 2012, approximately 52.4 % of total gross electricity
production (87.6 TWh) was generated from coal, 34.6 %
from nuclear energy and 9.3 % from renewable sources.
Conventional coal - fired power stations have a total
capacity of approximately 10.8 GW. The Czech electricity
market has been fully liberalised since 2006 and the gas
market since 2007.
Ostrava-Karviná
Basin
Labe
Odra
Vltava
Moravaa
Hodonin
Sokolov Basin
Kladno
Prague
Ostrava
Brno
Karlovy Vary
Northern Bohemian
Basin
Hard coalLignite
Hard coal and
Anthracite
GDP € billion 152.3
There are five coal mining companies in the Czech
Republic: OSTRAVSKO - KARVINSKÉ DOLY, the only
hard coal producer, and four brown coal companies,
SEVEROČESKÉ DOLY, owned by ČEZ and the biggest
producer of brown coal, VRŠANSKÁ UHELNÁ, with coal
reserves to last until 2055, SEVERNÍ ENERGETICKÁ
(Sev.en – formerly LITVÍNOVSKÁ UHELNÁ) with the
largest brown coal reserves in the Czech Republic,
and SOKOLOVSKÁ UHELNÁ, the smallest brown coal
company. All of these coal mining companies have been
privatised. ČEZ is the largest coal consumer in the Czech
Republic and the most important Czech supplier of
electricity. In 2012, ČEZ generated 64 TWh, i.e. 73 %
of the country’s electricity generation. The ČEZ Group
is listed on the Prague and Warsaw stock exchanges,
although remains majority state - owned.
Czech Republic

Czech Republic
Hard coal
The Czech Republic has 181 million tonnes of economically
recoverable hard coal reserves. The largest hard coal
deposits are located in the Upper Silesian Coal Basin.
With an area of 6 500 square kilometres, this coal basin
ranks among the largest in Europe. A major part is
located in Poland, while about one sixth (1 200 square
kilometres) lies in the Czech Republic where it is called
the Ostrava - Karviná Basin (after the city of Ostrava and
the town of Karviná). Here, OSTRAVSKO - KARVINSKÉ
DOLY (OKD) extracts hard coal from deep mines. In 2012,
saleable output was 11.4 million tonnes, with a workforce
of 12 866 own employees and 16 432 contractors. Coal
is currently extracted at four deep mines: Karviná, ČSM,
Darkov and Paskov. The worked seams in Ostrava at the
Paskov colliery range in thickness from 0.8 to 1.6 metres.
The thickness of the Karviná seams ranges from 1.5 to
6.5 metres. Longwall working with shearer loaders
(90.2 %) and ploughs (9.8 %) is employed, combined
with controlled caving. Mechanical supports (95.1 %) and
individual hydraulic props (4.9 %) are used to support the
coalfaces. At each of the collieries, the extracted coal
is processed in preparation plants where it is graded as
coking coal or steam coal, based on its quality parameters.
Brown coal and lignite
The Czech Republic has 873 million tonnes of economically
recoverable brown coal and lignite reserves. In addition
to a coal basin in northern Bohemia and another near the
town of Sokolov, there are also coalfields in the south of
the country, although they are not economically viable.
Elsewhere, production of brown coal totalled 43.5 million
tonnes in 2012, providing an important contribution to
the country’s energy supply. Brown coal production in
the Czech Republic has been quite stable in recent years,
ranging from around 44 to 49 million tonnes.
The main brown coal deposit and the largest mining
area, covering 1 400 square kilometres, is the Northern
Bohemian Brown Coal Basin, which is located in the
foothills of the Krušné hory mountains, along the border
with Germany (Saxony), in the vicinity of the towns of
Kadaň, Chomutov, Most, Teplice and Ústí nad Labem.
The seams in this area extend to depths up to 400 metres
and are between 15 and 30 metres thick.
Brown coal is extracted in the central part of the Northern
Bohemian Brown Coal Basin by two mining companies,
VRŠANSKÁ UHELNÁ (VUAS) and SEVERNÍ ENERGETICKÁ
(Sev.en – formerly LITVÍNOVSKÁ UHELNÁ or LUAS).
In 2012, VUAS extracted 8.9 million tonnes of brown coal
at the Vršany site. LUAS extracted 4.6 million tonnes
of brown coal at the ČSA site. ČSA boasts the largest
brown coal reserves in the Czech Republic – sufficient
to support coal mining to 2100 and beyond. However,
extraction is curtailed by mining limits imposed in 1991.
Within the current mining limits, extraction will last until
2022. However, beyond the mining limits lie an estimated
750 million tonnes of high - quality brown coal. In 2012,
VUAS had a total workforce of 850 and LUAS had 590
employees.
The only deep brown coal mine in the Czech Republic,
Centrum, is also located in the central part of the Northern
Bohemian Brown Coal Basin. In 2012, some 300 employees
extracted about 0.4 million tonnes of brown coal there.
After extraction, the brown coal is processed at the
Komořany preparation plant, which supplies a broad range
of coal products. Graded, pulverised and single - purpose
products are delivered to power stations, the heat supply
industry and households. Fuels blended for the energy
sector are supplied to power stations (Počerady, Chvaletice,
Mělník, Poříčí, Opatovice and Hodonín), CHP plants and
energy complexes.
The brown coal company SEVEROČESKÉ DOLY (SD) based
at Chomutov operates in the north - western part of the
Northern Bohemian Brown Coal Basin, to the east of the
town of Most. SD extracts brown coal at two sites, namely
Doly Nástup Tušimice and Doly Bílina. A total of 22.8 million
tonnes was produced in 2012, increasing SD’s share in
national brown coal production to almost 50 %.
The Doly Nástup Tušimice brown coal mining area is located
between the towns of Chomutov and Kadaň and consists
of one large surface mine with an average annual output of
13 million tonnes. After preparation at the Tušimice crushing
plant, most of the product is supplied to power stations
operated by ČEZ.
The Bílina brown coal mining area has one surface mine.
Doly Bílina is located between the towns of Bílina and
Duchcov. More than 9.5 million tonnes of brown coal
are produced each year and transported to the Ledvice
preparation plant before being delivered to power stations,
industries and households.

Coal resources and reserves Unit 2012
Resources hard coal Mt 617
Resources lignite Mt 1 711
Reserves hard coal Mt 181
Reserves lignite Mt 873
Primary energy production
Total primary energy production Mtce 45.3
Hard coal (saleable output) Mt / Mtce 11.4 / 10.5
Lignite (saleable output) Mt / Mtce 43.5 / 19.2
Saleable coal quality
Hard coal net calorific value kJ / kg 25 490 - 32 070
Lignite net calorific value kJ / kg 11 600 - 20 560
Hard coal ash content % a.r. 4.3 - 18.9
Lignite ash content % a.r. 5.97 - 37.8
Hard coal moisture content % a.r. 3.5 - 9.9
Lignite moisture content % a.r. 26.46 - 38.3
Hard coal sulphur content % a.r. 0.42 - 0.43
Lignite sulphur content % a.r. 0.78 - 1.44
Coal imports / exports
Hard coal imports Mt 2.0
Hard coal exports Mt 5.6
Primary energy consumption
Total primary energy consumption Mtce 60.8
Hard coal consumption Mtce 5.9
Lignite consumption Mtce 18.8
Power supply
Total net power generation TWh 81.1
Net power imports / (exports) TWh (17.1)
Total power consumption TWh 58.8
Power generation from hard coal TWh 4.5
Power generation from lignite TWh 35.2
Capacity of coal - fired generation MW 1 200
Capacity of lignite - fired generation MW 9 600
Employment
Direct in hard coal mining thousand 12.866
Direct in lignite mining thousand 9.093
In 2012, the SD group had a total workforce of 5 145.
Located in western Bohemia, in the western part of the
coalfield below the Krušné hory mountains, the brown
coal basin around the town of Sokolov is mined by
SOKOLOVSKÁ UHELNÁ (SU). The company operates
two surface mines, the Družba and Jiří mines. In 2012,
its output was 6.7 million tonnes.
SU’s key products include electricity and heat, graded
coal, steam coal and chemical products produced during
coal gasification. Brown coal from the Sokolov area is
mainly used for power and heat generation. SU generates
electricity in two of its own power plants: the Vřesová
IGCC plant (2 x 200 MWe) and a CHP plant (5 x 270 MWt),
which have a combined annual output of 3.5 TWh. Most
of the heat produced is consumed by the company itself,
although some is supplied to the towns of Karlovy Vary,
Nejdek, Chodov and Nová Role. The company also pursues
environmental activities, notably the reclamation of land
affected by surface mining, and waste processing and
disposal. SU’s operations employed a total workforce of
4 070 in 2012.
A smaller deposit of some 200 million tonnes of workable
lignite is located in southern Moravia near the town of
Hodonín. Approximately 0.5 million tonnes of lignite per
year from underground mines were produced there.
Lignite production stopped in 2010.
The Czech brown coal industry has always played an
important role in the national economy. According to
the current National Energy Concept, coal is expected
to remain an important energy resource in the Czech
Republic, playing a significant role in the Czech energy
mix. The Czech Republic devotes great attention to the
clean use of brown coal. A very good example is the
comprehensive programme to renovate and develop
coal - fired power stations in northern Bohemia. The
800 MW Tušimice power station has been renovated;
its CO2
emissions have been significantly reduced and its
life has been extended to 2035. September 2012 saw the
launch of the renovation of the Prunéřov power station,
with the objective of reducing emissions by 40 % and
extending its life by 25 years. The Ledvice power station
is under construction and is expected to be commissioned
in 2014 with a planned life of 40 years.
Czech Republic

Germany
Germany
Ibbenbueren
Saar
Ibbenbuere
Ruhr
Lusatian
Area
Central German
Area
nen
Helmstedt Area
S
Rhineland
Area
n
Oder
W
eser
re
e
al
en
Main
Donau
Isar
Rhein
Elbe
Berlin
Hamburg
Dresden
LeipzigEssen
Köln
München
Frankfurt
Hard coalLignite
Hard coal and
Anthracite
Germany has considerable reserves of hard coal
(2 500 million tonnes that are technically accessible of
82 961 million tonnes of known resources) and lignite
(40 400 million tonnes), making these the country’s most
important indigenous source of energy. However, in the
case of hard coal there remain only 37 million tonnes to be
extracted following the political decision to end subsidised
German hard coal production in 2018.
In 2012, primary energy production totalled 148.4 million
tonnes of coal equivalent (Mtce), excluding nuclear. With
an output of 68.3 Mtce, coal and lignite had a share of
46 %. The mix of indigenous primary energy production
can be broken down as follows: 57.2 Mtce of lignite
(38.5 %), 11.1 Mtce of hard coal (7.5 %), 13.3 Mtce of
natural gas (9.0 %), 3.8 Mtce of oil (2.5 %), 54.3 Mtce
of renewable energy (36.6 %) and 8.7 Mtce from other
sources (5.9 %).
Germany’s primary energy consumption amounted to
469.4 Mtce in 2012. Oil accounted for the largest share
(32.9 %), followed by coal (24.8 %), natural gas (21.5 %)
and nuclear energy (7.9 %). Renewable energy grew to
11.6 %. Within the figure for coal, hard coal accounted
for 12.8 % and lignite for 12.0 % of total primary energy
consumption. Germany is dependent on energy imports
to a large extent, except in the case of lignite. About 87 %
of hard coal was imported, in comparison with 98 % of oil
and 87 % of gas.
The power generation structure is characterised by a
widely diversified energy mix. In 2012, gross power
generation of 628.7 TWh output was produced as follows:
44.2 % from coal (of which 25.7 % was from lignite and
18.5 % from hard coal), 15.8 % from nuclear, 12.0 % from
natural gas, 22.6 % from renewable energy sources and
5.7 % from other sources. This means that hard coal and
lignite, as well as nuclear energy, are the mainstays of the
German power industry.
The federal government adopted its Energiekonzept
or energy concept in October 2010. It combines a life
extension of German nuclear power plants (on average
by 12 years, with the last shutdown around 2040) with
“green” energy policy objectives. The focus to date
has been on ambitious climate protection policies: a
CO2
emission reduction of at least 80 % by 2050 with
step - by - step objectives for each decade, including a 40 %
reduction by 2020, a massive increase in energy efficiency
to yield total energy savings of 20 % by 2020 and 50 % by
2050, and the steady development of renewable energies
to a 60 % share of final energy consumption and 80 % of
power generation by 2050. The Energiekonzept should also
be understood as a "Roadmap into the age of renewable
energies" and the extended use of nuclear energy as the
“bridge” to get there, although 2011 saw the collapse of
this bridge.
To implement the new Energiekonzept, an immediate
10 - point programme was introduced for offshore wind
and measures in connection with extending the life of
GDP € billion 2 666.4

nuclear power plants, including the introduction of a new
tax on nuclear energy. Coal played only a secondary role
in the Energiekonzept, without any specific objectives
or long - term perspective. Coal - fired power plants
shall, in the future, have the role of swing and reserve
supplier to balance the ever - increasing power generation
from renewables. Scenario calculations underlying the
Energiekonzept foresee a drastic decrease of overall coal
use in Germany. The market for hard coal halves by 2020
and then halves again by 2050.
Subsidised hard coal production is to be phased out
by 2018, in agreement with national and European
regulations. Lignite use, according to the scenarios,
remains stable until 2020, but practically disappears
as an energy source by 2050.
From a technical point of view, the Energiekonzept is
based on a number of doubtful premises: a strong global
agreement on climate policy, a perfectly organised
European energy market, future technical innovations
and efficiency leaps in the energy sector, solutions to
all problems concerning public acceptance, and smooth
changes to the structure of the energy economy given
the assumed economic growth to 2050. Successful
implementation of the concept therefore seems to be
questionable.
In the meantime, the nuclear incident at Fukushima
in Japan in March 2011 re - ignited the debate about
extending the lifespan of nuclear power plants in Germany.
The federal government initially announced a nuclear
moratorium and wanted to redraft its Energiekonzept
during the summer of 2011. All political parties have now
set themselves the objective of phasing out nuclear as
fast as practicable. A return to the situation prior to the
granting of lifetime extensions to nuclear power plants
is seen as a minimal objective, together with improved
efficiency and an accelerated development of networks
and infrastructure across the entire energy sector. Now,
there is an agreement among all political parties not to
restart the eight nuclear power plants that were shut
down during the moratorium, to phase out the remaining
nine nuclear power plants in Germany by 2022 at the latest
and to speed up the move to a “green” energy economy.
For this purpose, the German government has outlined
a package of several new or amended energy laws and
further political measures to foster change in the energy
sector.
In total, it is expected that German electricity consumers
will pay more than € 20 billion of EEG levies in 2013 to
promote renewable energy. This is because a dramatic
increase in the Erneuerbare - Energien - Gesetz (EEG –
German Renewable Energy Act) levy was announced
in October 2012. The 5.3 €c / kWh levy has triggered
a controversial debate since the public is concerned
about how EEG costs are shared. In response, the
federal government proposed an “EEG price brake”
(Strompreisbremse). However, the proposal was not
adopted and it does not address other issues, such as
the impact on competition in the electricity market.
The way to an “age of renewable energies” has to be
smoothed in Germany and elsewhere. Modern coal - and
gas - fired power plants represent the technological bridge
along this path. To this extent, the prospects for coal in
general, and especially for coal - fired power plants under
construction or in the planning stage, have become
somewhat brighter.
Germany

Germany
Hard coal
In 2012, the German hard coal market amounted to
57.0 Mtce, of which 40.1 Mtce were used for power
and heat generation, whilst 15.4 Mtce went to the
steel industry. The remaining 1.5 Mtce were sold to
the residential heating market.
Germany was the EU’s largest hard coal importer in 2012,
as well as one of the world’s largest coke importers.
Some 45 million tonnes of hard coal (steam coal and
coking coal) or 79 % of national consumption were
imported in 2012. The biggest suppliers of hard coal to
Germany were Russia, with a market share of more than
24 %, and the USA with 25 %, followed by Colombia with
21 %. Exports from Australia accounted for 11 % and from
Poland 8 % which was also an important coke supplier.
In the regions of the Ruhr, the Saar and in Ibbenbüren, coal
is extracted by RAG DEUTSCHE STEINKOHLE. In 2012,
RAG produced 10.8 million tonnes of saleable hard coal
(11.6 Mtce).
Restructuring of the hard coal industry continues in
Germany which in 2012 still had five operating deep mines,
namely the collieries West (which closed at the end of
2012), Prosper - Haniel and Auguste Victoria located in
the Ruhr area, the Saar mine in the Saar coalfield (which
closed at the end of June 2012) and another deep mine
near Ibbenbüren. Production in 2012 from these three
coalfields can be broken down as follows: 78 % from
the Ruhr area, 4 % from the Saar and 18 % from the
Ibbenbüren coalfield.
Employment figures continued to fall steadily. The number
of employees in the hard coal mining sector decreased
during 2012 by 15.8 % from 20 925 on 31 December
2011 to 17 613 on 31 December 2012. Productivity levels,
measured in terms of saleable output per man - shift
underground, increased after a crisis - driven decline in the
previous years from 6 623 kg in 2011 to 6 876 kg in 2012.
In 2007 and 2008, the formal separation of RAG’s
so - called “white” business, the former RAG Shareholding
Limited Company, was completed and the new EVONIK
INDUSTRIES AG was created. EVONIK, with its
commercial activities in the fields of chemicals, energy
and property, is now striving to list on the stock exchange
as an independent company.
The core business of RAG became hard coal mining, as
was the case for the former RUHRKOHLE AG, although
it has retained certain related activities, especially in
the fields of real estate in mining areas (RAG MONTAN
IMMOBILIEN) and in mining consultancy and equipment
sales (RAG MINING SOLUTIONS).
The private RAG Foundation, created in July 2007, is the
owner of both RAG and EVONIK. Its remit is to bring
its assets in EVONIK to the capital market, retaining
only a minority stake. Long - term liabilities after the final
phase - out of hard coal mining will be financed by the
proceeds. The German government has taken the decision
to phase out – in a socially acceptable manner managed
by the RAG Foundation – all state aid for coal production
by 2018. Using its assets, the Foundation will promote
training, science and culture in the mining regions.

Lignite
Lignite supply in 2012 totalled 56.1 Mtce, with domestic
output accounting for 57.2 Mtce and imports approximately
43 000 tce. Lignite exports amounted to 1.1 Mtce of
pulverised lignite and briquettes.
Lignite production, which totalled 185.4 million tonnes in
2012, was centered in four mining regions, namely the
Rhineland around Cologne, Aachen and Mönchengladbach,
the Lusatian mining area in south - eastern Brandenburg
and north - eastern Saxony, the Central German mining
area in the south - east of Saxony - Anhalt and in north - west
Saxony as well as the Helmstedt mining area in Lower
Saxony. In these four mining areas, lignite is exclusively
extracted in opencast mines.
Lignite is an indispensable energy source for Germany
because it is abundantly available for long - term use
and competitive. Furthermore, the lignite industry is an
important employer and investor, adding major economic
value to the mining regions.
More than 90 % of lignite production is used for power
generation (169.4 million tonnes in 2012), accounting
for nearly 26 % of total power generation in Germany.
In the Rhineland, RWE POWER AG produced a total
of 101.7 million tonnes of lignite in 2012 from its three
opencast mines: Hambach, Garzweiler and Inden. Almost
90 % of the lignite was consumed by the company’s own
power stations, whilst some 12.0 million tonnes were
used for processed products and for private consumption.
At the end of 2012, the lignite division of RWE POWER
had a total workforce of 11 241.
RWE’s BoAplus project is on track following a decision
of the Cologne regional council on 5 July 2013 to
amend its regional plan. This Aufstellungsbeschluss is
an important milestone in the overall approval process
which is expected to be completed by the end of 2014.
The selection of bidders for the main components (boiler,
steam turbine, cooling tower, electrostatic precipitator and
flue gas desulphurisation) is proceeding so that documents
Germany
required by the BlmSchG (the Federal pollution control act)
can be prepared – the final stage in the process.
The generation capacity of RWE POWER consists of
five lignite - fired power plants with a total capacity of
10 848 MW. At Neurath, a new lignite - fired power
plant with optimised plant technology (BoA 2 / 3) was
commissioned in August 2012, boasting a gross capacity of
2 200 MW and replacing old plants. The lignite - fired power
output in the Rhenish lignite mining area amounted to
some 74 TWh in 2012.
In the Lusatian mining region, where VATTENFALL
EUROPE MINING AG (VE - M) is the only producer, total
lignite output amounted to some 62.4 million tonnes.
The lignite is extracted in Jänschwalde, Cottbus Nord and
Welzow Süd in Brandenburg, as well as in Nochten and
Reichwalde in Saxony.
Lignite sales to public power plants amounted to
58.6 million tonnes. VATTENFALL EUROPE GENERATION AG
(VE - G) is the main operator of lignite - fired power plants in
the Lusatian area with a gross rated capacity of 7 581 MW.
In 2012, with the opening of the new 675 MW
Boxberg power plant, the gross power output from the
Lusatian lignite - fired power plants totalled 53TWh. At the
end of 2012, VE - M and VE - G had a total workforce of 7 758.
The Central German mining area around Leipzig yielded
a total lignite output of 19.2 million tonnes in 2012. The
most important company in this area is MITTELDEUTSCHE
BRAUNKOHLENGESELLSCHAFT (MIBRAG), owner of two
opencast mines at Profen (Saxony Anhalt) and Schleenhain
(Saxony).
In 2012, MIBRAG produced 18.7 million tonnes of lignite,
serving the three company - owned combined heat and
power plants at Deuben, Mumsdorf and Wählitz with a total
capacity of 208 MWe. At the end of 2012, MIBRAG had a
total workforce of 1 991.

COAL INDUSTRY ACROSS EUROPE 5TH EDITION 2013

COAL INDUSTRY ACROSS EUROPE 5TH EDITION 2013

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COAL INDUSTRY ACROSS EUROPE 5TH EDITION 2013